FCC approves new rules for next year’s auction, preventing a replay of Dish’s bidding shenanigans and denies AWS-3 discount

FCC approves new rules for next year’s auction, preventing a replay of Dish’s bidding shenanigans and denies AWS-3 discount
One of the more dramatic events of the recent spectrum auction that brought in more than double the revenue analysts or the FCC thought it would, was Dish Networks’ use of designated entities through much of its bidding.

The designated entity rules allow for smaller companies to leverage an up-to-25% discount against their bids. They are designed to enable competitors gain a foothold in markets dominated by larger players.

Dish leveraged two small companies it was majority owner of to bid over $13 billion in the AWS-3 auction, making the companies the second highest bidders behind AT&T. With the discounts, Dish stood to save $3 billion off its obligation from the licenses.

AT&T and Verizon filed their displeasure with the FCC, and the regulators were inclined to agree. Stating that Dish violated the spirit of the auction’s rules, the FCC concluded that the designated entities did not qualify for the discount.

Dish did not respond, but it is possible it, and its two entities may take the matter to court, as Dish has stated in the past it has abided by the rules. How, or if, this development could complicate Dish’s stalled negotiations to merge with T-Mobile is not known.

Meanwhile, the FCC also voted to change the rules of next year’s incentive auction so that manipulation of the designated entity rules cannot happen again. On top of that, the rules will also prevent joint bidding among national carriers, meaning T-Mobile and Sprint will not be able to collaborate on bidding, something the companies were hoping they could do.

sources: FierceWireless and The Wall Street Journal

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7 Comments

1. waddup121 unregistered

Wow...

2. Derekjeter

Posts: 1492; Member since: Oct 27, 2011

F@ck yeah!!! Verizon needs to buy all this spectrum and create a more powerful network.

6. erikiksaz

Posts: 170; Member since: Apr 22, 2010

You are f**king dumb.

7. Derekjeter

Posts: 1492; Member since: Oct 27, 2011

I'm dumb for wanting even stronger and faster Verizon network?? Why?? If your cheap consumer and have either T-Mobile or Sprint your the one who's dumb for being with a company that all they do is give away so much crap just to attract sales but do nothing for their network. What do you gain by having a good phone and cheap bill if you can't even use it?

8. Augustine

Posts: 1043; Member since: Sep 28, 2013

You are dumb for wanting a company to dominate one sector and make it less competitive. You are dumb because this leads to higher prices and lower quality. You are dumb because you think that you are the measure of all things and everyone, that everyone's needs are the same as yours.

4. mike2959

Posts: 694; Member since: Oct 08, 2011

That's funny, Dish network shenanigans!? As the 4 big dogs have been C blocking everyone else that even dreamed of getting in the Mobile network industry.

5. tyger11

Posts: 291; Member since: Oct 29, 2012

mike, there aren't four big dogs in this industry - there are only two, and two wannabees. Take note of which two companies "filed their displeasure with the FCC".

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